find the latest legal job
Inhouse Legal Counsel -18 months-4 PAE - Real Estate Investment Company
Category: Banking and Finance Law | Location: Melbourne CBD & Inner Suburbs Melbourne VIC
· In brand new prestigious CBD offices
View details
Senior Associate - Competition, Policy & Regulatory
Category: Other | Location: Sydney CBD, Inner West & Eastern Suburbs Sydney NSW
· Work with a well regarded Partner · Sydney CBD
View details
Commercial Litigation Senior Associate
Category: Litigation and Dispute Resolution | Location: Sydney CBD, Inner West & Eastern Suburbs Sydney NSW
· Lawyers Weekly Australia Partner of the Year 2016, Insolvency
View details
MULTIPLEX Regional Legal Counsel (Vic) | 7 to 10 years + PQE
Category: Generalists - In House | Location: Melbourne CBD & Inner Suburbs Melbourne VIC
· Career defining in-house role · Tier One international contractor
View details
Junior Lawyer - Personal Injury Law
Category: Personal Injury Law | Location: Parramatta & Western Suburbs Sydney NSW
· Highly specialized practice · Challenging role with great opportunities
View details
Grocery retailing workably competitive: ACCC

Grocery retailing workably competitive: ACCC

THE AUSTRALIAN Competition & Consumer Commission (ACCC) released its eagerly awaited report on the competitiveness of grocery prices last week.The report outlines the findings of a…

THE AUSTRALIAN Competition & Consumer Commission (ACCC) released its eagerly awaited report on the competitiveness of grocery prices last week.

The report outlines the findings of a comprehensive six-month inquiry by the commission — which, according to the report, involved analysing more than 250 public submissions and “vast quantities” of data and information supplied by Coles, Woolworths, Metcash and other retailer and suppliers.

Defying the expectations of many, the report’s key finding was that grocery retailing is “workably competitive”. At most, the inquiry has found, only about a twentieth of the increases in food prices in Australia over the past five years could be directly attributed to the increase in the gross margins achieved by the big grocery players. Factors that have had greater bearing on rising food prices include drought and natural disasters, the world commodities boom and increasing world food commodity prices, the report states.

However, the inquiry has found that there are several factors limiting grocery price competition — one being high barriers to entry and expansion resulting from the limited number of new sites. Potentially exacerbating this problem is Coles’ and Woolworths’ strategy of entering into restrictive leases with shopping centres.

According to the report, the ACCC has received “specific and credible evidence” that Coles and Woolworth include terms in their leases with shopping centres which effectively prevent the shopping centre leasing space to competing grocery retailers.

The report states that the ACCC will review the issue further, with a view to potentially taking action under the Trade Practices Act. Mallesons partner Caroline Coops, who represented Coles on the inquiry, explained that the ACCC does have the power to under the Trade Practices Act to take action against restrictive leases.

“They have power under the Trade Practices Act to … go to court to try and seek orders that would prevent that restrictive lease being entered into, or if it’s already been entered into, then to prevent to parties from enforcing [the restrictive provision],” she said.

The report has also responded to concerns that Coles and Woolworths have undertaken a strategy of acquiring smaller independent supermarkets. While it concluded that it is not currently a significant concern for the industry, the ACCC did recommend reforming the law to enable it effectively monitor “cumulative acquisitions”.

According to Coops, while the ACCC can take action against individual acquisitions which have the effect of substantially lessening competition, they don’t at present have the same power with respect to cumulative, smaller acquisitions that might have the same effect.

“Under the current text of the Trade Practices Act, it’s not possible for the ACCC to take action in respect of a series of individual acquisitions which don’t, in themselves, substantially lessen competition, but taken together, might,” she explained. “The ACCC is recommending that there be a change to section 50 to allow them to investigate and, if necessary, block a creeping acquisitions scenario.

One of the report’s other key recommendations is for governments to amend planning laws to require supermarket competition considerations to be taken into account when development or rezoning applications are being considered. The federal government has responded, with the Minister for Consumer Policy and Consumer Affairs, Chris Bowen, announcing last Tuesday that the issue will be referred to the Council of Australian Governments (COAG).

It also recommends that a mandatory, nationally consistent unit pricing regime be introduced for larger supermarkets, which would make it easer for consumers to compare prices of standard grocery items.

Like this story? Read more:

QLS condemns actions of disgraced lawyer as ‘stain on the profession’

NSW proposes big justice reforms to target risk of reoffending

The legal budget breakdown 2017

Grocery retailing workably competitive: ACCC
lawyersweekly logo
Promoted content
Recommended by Spike Native Network
more from lawyers weekly
Animal law moots, advocacy, Melbourne University, Australia and New Zealand Intervarsity Moot on Animal Law
Sep 25 2017
Moot unleashes animal advocacy
Melbourne has played host to one of the largest animal law moots, with student participants put th...
Sep 25 2017
Transgender teens should not need legal approval for hormone treatment, court hears
A transgender 17-year-old known as Kelvin has appealed in the Family Court against the requirement o...
Appointed, Victorian Legal Services Commissioner
Sep 25 2017
NFP CEO appointed Victorian Legal Services Commissioner
The CEO of a Victorian not-for profit pro bono legal services provider has been named as the state...
Allens managing partner Richard Spurio, image courtesy Allens' website
Jun 21 2017
Promo season at Allens
A group of lawyers at Allens have received promotions across its PNG and Australian offices. ...
May 11 2017
Partner exits for in-house role
A Victorian lawyer has left the partnership of a national firm to start a new gig with state governm...
Esteban Gomez
May 11 2017
National firm recruits ‘major asset’
A national law firm has announced it has appointed a new corporate partner who brings over 15 years'...
Nicole Rich
May 16 2017
Access to justice for young transgender Australians
Reform is looming for the process that young transgender Australians and their families must current...
Geoff Roberson
May 11 2017
The lighter side of the law: when law and comedy collide
On the face of it, there doesn’t seem to be much that is amusing about the law, writes Geoff Rober...
May 10 2017
Advocate’s immunity – without fear or without favour but not both
On 29 March 2017, the High Court handed down its decision in David Kendirjian v Eugene Lepore & ...